AMMAN – The International Monetary Fund (IMF)
approved of a new Extended Fund Facility (EFF) for Jordan, spanning four years,
allowing an initial disbursement of $190 million to support the government's
economic program, Al-Mamlaka TV reported.
اضافة اعلان
The Executive Board of IMF approved the
new four-year EFF agreement with Jordan, amounting to $1.2 billion, noting that
the remaining amount will be distributed over the program's implementation
stages.
The new EFF arrangement aims to support
the government's efforts to maintain overall stability, gradually adjust public
debt on a downward path, protect social and capital spending, improve financial
conditions, enhance the efficiency of the electricity sector, and maintain an
appropriate exchange rate policy.
IMF Deputy Managing Director, Kenji
Okamura stated that Jordan has successfully navigated through various shocks in
recent years, maintaining overall stability and moderate economic growth
through sound policies and substantial international support, adding that
Jordan also made significant progress in implementing structural reforms.
Okamura emphasized the importance of the
Central Bank of Jordan (CBJ) of Jordan's prudent policies, which helped maintain the
stability of the Jordanian dinar and financial stability, recommending that
monetary policy should continue focusing on maintaining monetary and financial
stability by adjusting interest rates as needed to support the exchange rate.
Seven
successful reviewsThe new program's ranking builds on
Jordan's strong performance under the previous arrangement, and six successful
reviews were completed on time. The IMF highlighted Jordan's progress in
financial integrity, removing the country from the Financial Action Task
Force's grey list (FATF). Furthermore, implementation of recommendations from
the Financial Sector Stability Assessment jointly conducted by the IMF and
World Bank in 2023 is crucial for further strengthening financial sector
oversight.
Okamura also emphasized the need for
continued donor support to help Jordan navigate a challenging external
environment, host refugees, and maintain reform momentum.
Jordan’s
strategic choiceMinister of Finance, Mohamad Al-Ississ emphasized that the program is a strategic choice for Jordan, prepared by
relevant Jordanian ministries and institutions.
CBJ Governor Adel
Al-Sharkas stressed the importance of the new EFF program in continuing the
reform approach, reinforcing the resilience of the national economy, and
enhancing flexibility to face shocks.
CB
is committed to maintaining monetary and banking stability, including the fixed
exchange rate policy with the US dollar. CB also aims to enhance the
digitization of financial services, expand financial inclusion, and improve the
insurance sector to align with global best practices. Additionally, efforts
will be directed toward strengthening anti-money laundering and
counter-terrorism financing systems.
The program does not include raising or
imposing new taxes, and the government remains committed to combating tax
evasion and avoidance to achieve tax fairness without adding new tax burdens on
citizens.
Economic
predictions
The IMF's economic indicators for Jordan
foresee a Gross Domestic Product (GDP) growth of 2.6 percent for 2023 and 2024,
along with three percent for the years 2026 to 2028. Inflation is expected to
rise to 2.7 percent in the current year from 2.2 percent in 2023, returning to
a decline in 2025 at 2.4 percent and stabilizing at 2.5 percent for the years
2026 to 2028.
The projection also anticipates a
decrease in the general government debt-to-GDP ratio from 112.7 percent in 2024
to 110.4 percent and 108.2 percent in 2027 and 2028, respectively. Jordan's
public debt, excluding social security guarantees, is expected to reach 78.6
percent of GDP in 2028, down from an anticipated 88.3 percent in 2024.
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